Issues, Challenges, Debates Peter G. Klein University of Missouri - - PowerPoint PPT Presentation

1 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Entrepreneurship Theory: Issues, Challenges, Debates

Peter G. Klein University of Missouri

ENT Doctoral Consortium San Antonio, August 2011

2 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Theorizing about entrepreneurship

► General issues and problems ► Some important theoretical

contributions

► Relationship between theory

and applied work

► Caveats

3 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Issue #1: What exactly is entrepreneurship?

► A phenomenon

• Self employment
• Startups
• Small-business management
• New-product introduction
• Analytical tools: “standard” economics,

sociology, psychology, history

► A way of acting

• Creativity, imagination, initiative
• Innovativeness
• Alertness to profit opportunities
• Judgment under uncertainty
• Analytical tools: “alternative” economics, sociology, psychology, history

► My secret desire: drop the e-word

4 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Issue #2: “Theory” – varies by academic discipline

► Neoclassical economics

• Labor-economics literature on occupational choice
• Economics of innovation and technology
• Economics of networks

► Heterodox economics

• Behavioral economics models of biases and

heuristics

• Austrian perspectives on discovery and judgment

► Sociology

• Social network theory
• Identity

► Psychology

• Entrepreneurial cognition

► History, rhetoric ► Others? ► Multidisciplinary approaches

• Entrepreneurial orientation
• Effectuation
• Strategic entrepreneurship

literature

• Positioning issues?

5 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Issue #3: Metholodogy

► The unit of analysis

• Individuals?
• Teams?
• Firms?
• Industries, economies, societies?
• Opportunities?
• Investments?
• Behaviors?

► Methodological

individualism

► Causation ► Theory and practice

 



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Figure 1: A General Model of Social Science Explanation 1 2 3 4 Individual action Conditions

• f individual

action Social

• utcomes

”Social facts” (e.g., institutions) ”macro” ”micro”

6 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

► Schumpeter (1911): introducing exogenous change to Walrasian equilibrium ► Knight (1921): decomposing interest, wages, and profit; risk versus

uncertainty

► Kirzner (1973): using alertness to explain market equilibration

(Note on instrumentalism)

► Kihlstrom and Laffont (1979): self-

employment and risk aversion

► Baumol (1990): productive, unproductive, and destructive entrepreneurship ► Lumpkin and Dess (1996): entrepreneurial orientation ► Garud and Karnoe (2003): bricolage versus breakthrough ► Lazear (2004, 2005): balanced skills ► Alvarez and Barney (2007): discovery versus creation

Some important theoretical contributions

7 | Entrepreneurship Theory Peter G. Klein | University of Missouri | AoM 2011

Soapbox comments

► There is no “entrepreneurship theory.” ► Many theory papers try to do too much (the

kitchen-sink model).

► We have few established criteria for choosing

among rival theories.

► Good research can be phenomenon driven,

not theory driven.